Overwhelming Demand

Posted on March 22, 2012 by

A new year arrives and with it comes change. Maybe your company or division is emerging from constricted growth. Maybe you are in the aftermath of an enterprise transformation rollout. No matter what the events were that caused it, all of a sudden your portfolio management team is dealing with a dramatic increase in project requests.

The first signs are classic. Unhappy sponsors start inquiring into the state of their requests. Your aged project request report indicates a large spike in the duration a project takes to go from stage to stage. Standing portfolio meetings are being extended and extra meetings are requested. Not enough resources are trained to provide consistent and high quality business cases. The list goes on, but it is very obvious that the people, processes and governance that was put in place to manage the portfolio demand is struggling to scale with the changing business climate.

So what do you change?

Do you increase your process bandwidth by adding people and availability so speed is not a factor? Do you relax or remove some of your approval gates to increase throughput? Do you reduce the amount of business case scrutiny from Finance? Do you add a more robust tool to your processes to help speed up what if analysis and portfolio balancing?

In my humble opinion, at this point in time it is more important than ever for portfolio management to help a company ensure that they are doing the right projects. There should be extra scrutiny. There should be more projects rejected. Business cases have to prove high value. Projects need to be closely aligned with business objectives and goals. If your portfolio management team lets the pressure of an increased volume of projects soften the vetting process, the value portfolio management can deliver is diminished.

What do you think?

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How to kill off Portfolio Management

Posted on December 13, 2011 by

So here is the starting scenario. Your company has created either an Office of Portfolio Management (OPM) or maybe they have aligned Portfolio Management into an EPMO or a PMO. You are multiple months into it, assume 6-12 months. Now, what are the top ten things you can do to help ensure that your company will consider killing off your Portfolio Management implementation.

1. Designate one person in your OPM to contact each stakeholder weekly in order to get updates on their sponsored projects
2. Run your scheduled portfolio review meetings off of printouts
3. Do not require a standard business case format
4. Allow everyone in the company to enter in project requests
5. Prioritize the projects in private
6. Do not align projects to the key business drivers or goals
7. Re-prioritize projects weekly
8. Do not let anyone challenge project prioritization
9. Let any approved project gather resources and start
10. Do not bother trying to slot/schedule your portfolio based upon resource availability

Now that you have done all the right things to get your Portfolio Management implementation killed off, are you ready to go back to the days of lore? Where you had massive working spreadsheets that go on forever and never quite report what was needed. Project prioritization based on who yelled the loudest. Business case data pulled out of thin air. No centralized or current list of active or approved projects. Every project was deemed high priority. Every project was approved. No one was communicating project prioritization.

I do hope that all of you out there who have a Portfolio Management solution or process in place take pride and ownership in it. Ensuring that you do not let bad behavior and informality drive away the value that Portfolio Management can help your organization realize.

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Courageous Dashboard Conversations

Posted on September 15, 2011 by

We have all seen them. The Red Dashboard of Death, or the Green Dashboard of Hope, but how often have you seen the Dashboard of Reality? Company culture, perceived peer perception, political posturing, and sometimes even fear drive people to report active portfolio health in a less than truthful state.

It happens every Monday morning, or whenever project status reports are due. It starts with the Project Manager and their lead(s) chatting about the health of the projects. Do we think we can finally start those three late tasks? Do we think Billy or Susie will be able to finish their critical path tasks on time? How realistic do you think the estimates are on those risky tasks? After that, the Project Manager will often go discuss with their boss the “I think”, the “We hope”, and the “If everything goes right” scenarios that are ripe with speculation. Then, the most classic of statements is uttered, the “Let’s see how things pan out over the next couple of weeks before we report anything as yellow or red”.

Courageous dashboard conversations should never allow the “Let’s see how things pan out…” statement to be spoken. Executive Management deserves to hear the truth about the health of the projects in their active portfolio.

I was at the PMI-MN Portfolio Management Local Interest Group (LIG) panel discussion on “When to Kill a Project” and one of the audience members told a story about a conversation they had with their CIO. The CIO asked the Project Manager what conversation they would rather have. The conversation where they explain some of the challenges they are facing on their project to the CIO while they are reporting some health indicators as yellow. Or the conversation two weeks later when all of the “I think”, the “We hope”, and the “If everything goes right” did not come true and project is in a Red state of health and the CIO wants to know why no one saw this coming? I know which conversation I would rather have.

What about you?

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Portfolio or Project Management?

Posted on August 26, 2011 by

So what came first, the chicken or the egg? I know, not a fair question. So what is more important, Project Management or Portfolio Management? What should a PMO Director invest in first, Portfolio Management or Project Management?

I think many people might answer quickly with “Project Management”. If you look historically at PMO’s you will see most of them started with a clear objective of maturing the Project Management discipline. The CIO was getting a lot of heat from the business side to deliver projects on time, without so many cost overruns, and of course to eliminate the dreaded “Failed” project status. Those dashboards full of red health indicators gave CIO’s heartburn like you could not believe. They had to invest in maturing the Project Management discipline or they would get thrown out of the executive suites faster than Superman could change in a phone booth.

While I will be the first to agree that the above position sounds pretty solid, I believe if you think a little bit harder about the whole end to end issue at hand, you might take a different position. I know many of us have heard the old business analogy where you have a bunch of loggers in a forest cutting down trees they think they are doing the right thing, but when one of them finally takes the time to climb a tree and look around, they figure out they are in the wrong forest. Yes, it is the old tactical vs. strategic conundrum.

The argument I am going to bring forward and I believe other thought leaders are rallying behind, is that if you are doing the wrong projects, then it does not matter how well your project managers are executing. My experience has shown me that many organizations do not understand how they are investing their resources (people and dollars) in direct relationship to their business objectives. The classic example is an organization that is spending 50% of their portfolio resources on cost reduction projects when in reality cost reduction is #3 or #4 in their list of business objectives and should not be allocated any more than 20% of available resources. It is no wonder organizations fail year after year to get maximum value out of their portfolio of projects in conjunction to their prioritized business objectives.

Bottom line, every PMO Director needs to help prioritize which areas of their PMO they invest in. My position is that Portfolio Management should be first, with Project Management a close second. Make sure you are doing the right projects before you worry about doing the projects right.

What do you think?

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Nonstandard PPM?

Posted on July 8, 2011 by

Nonstandard PPM?

I attended the Gartner PPM & IT Governance Conference in San Diego, CA the other week. For those of you who are not familiar with the conference, let me give a quick breakdown of the format. Gartner Analysts typically speak for the whole day except for the 3:15 slot where they invite vendors to speak (e.g., Microsoft, Planview, SAP, etc.) or to present successful implementations with their clients.

The conference started out with a keynote presentation by three key Senior Gartner Analysts in the PPM space. They go through a “What is hot and what is not in PPM and IT Governance” presentation in the PPM space. One of the key predictions was that enterprises will invest 30% less in time and money on traditional Project Management by 2014. The logic or reasoning was that organizations are going to have more nonstandard projects and Project Managers will need to use alternative approaches to successfully manage these nonstandard projects to a successful completion.

While I agree that there are more and more non-standard projects in our portfolios, I struggle with what the definition would be for nonstandard Project Management. Yes, you guessed it, there was not one given. If I anchor back to PMBOK and think of all of the tools and processes that it gives, my first inclination would be that Project Managers would be expected to use what is applicable to their project. I almost feel like Gartner is stating the obvious, which to me is that every Project Manager needs to be thinking creatively to ascertain what type of project is at hand, what tools/processes are needed and how to best use them to deliver the project value. If a Project Manager is just following the Framework/Methodology laid out by their organization and never questioning the value of a process or artifact as it relates to their project, then in my opinion the Project Manager is being lazy.

In the same light, every Portfolio Manager needs to be analyzing their portfolio for nonstandard projects, nonstandard business cases, and nonstandard enterprise alignment. The PPM processes have to be constantly vetted and recalibrated to ensure that nonstandard projects are not accidentally eliminated from the enterprise portfolio. A company’s future could be put in jeopardy by not recognizing the value of nonstandard projects and ensuring that they are properly prioritized and delivered through what Gartner calls, nonstandard project Management.

What do you think?

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Risk vs. Value

Posted on June 3, 2011 by

Recently I was working with a client on a new scoring model for their portfolio. The scoring model consisted of a set of questions that have a predefined set of answers. Typically each question has 4 to 5 answers. If it is a Yes or No question I like to put degrees of Yes and degrees of No. Something like, “Yes, all of the time” or “Yes, some of the time” or “Yes, but not often”. I then use multipliers and weights to design a scoring model that provides data and information for the management decisions that need to be made. What I seem to get into heated discussion over though is what is the root of the question being asked and whether it is value or a risk question.

I like to classify questions as either value or risk, which enables them to be graphed with an X and Y axis and put the relationship into four key quadrants.

- High Risk, Low Value
- High Risk, High Value
- Low Risk, Low Value
- Low Risk, High Value

Typically the High Risk/Low Value quadrant gets a very low priority, or is not approved. The Low Risk/High Value quadrant typically gets a high priority, and the other two quadrants require the hardest analysis.

The issue I typically run into is if the question should be classified as a value question or a risk question. Some questions can be answered both ways with very different answers. For example, asking a question like “Is this project for a known sponsor/client?” It is important to vet out what question is really being asked. Is the example question trying to find out if the sponsor/client is friendly or if the sponsor/client already has an expectation from previous projects or is it to find out if the sponsor/client is good at managing risk? Are there political undertones with the question? If the sponsor/client is known, are we asking the question to assign value points because we want to keep our current sponsors/clients coming back for more projects? Or if the sponsor/client was not very skilled or mature in sponsoring a project and thus we want to assign higher risk numbers so the project is properly governed.

Once you figure out if there are multiple meanings to a question, deciding if the question should be asked twice is typically the next step. Sometimes you might want to leave the question exactly the way it is, and just have two sets of answers, one with Risk answers and another with Value answers. My recommendation would be to have two questions, worded more succinctly where the reader can tell it is a value or risk question by the wording. What do you think?

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The Balance

Posted on May 20, 2011 by

How much rigor do you really want in your RFP Portfolio Management governance process? I would argue that for both Application and Project Portfolio Management you want to drive towards a lot of rigor to ensure high quality data and metrics you are confident with. But what about your portfolio of RFPs, RFIs and RFQs, should you have the same standards for it?

For many organizations, RFP/I/Qs can flow through their doors at a very rapid pace. Some requests impact a single department, some will span multiple departments and others will be enterprise wide. The requests that only span a single department, in my opinion do not need to go through as much rigor as the other requests. To subject them to the same amount of governance and review & approval as the enterprise wide requests seems a little ridiculous. Especially, if many of the single department requests are for standard repeatable, maybe even catalog quality, solutions or deliverables.

For me, the big question is how to execute the trust but verify approach while balancing agility and speed. As we all know, requests usually come through with a predefined due date. Those due dates rarely seem to give a response team as much time as they would like. So an RFP portfolio governance team and process needs to balance how much command and control they enforce over the portfolio without slowing down and potentially derailing an organizations ability to respond to valuable requests.

My typical solution to this problem is to use classification of requests to dictate how much rigor is enforced. By assigning an A, B or C categorization to each of the requests, you can then customize your governance solution appropriately. So in the example above where the requests is for a solution out of a single department and the scope is well understood, I would want to classify it with a C categorization and architect a process so it could be self-governed. But for A and B categorization, a managed and audited governance process would need to be put in place.

What do you think? Am I opening myself up for problems later on with a self-governed portfolio categorization? Will I ever be able to trust the data and metrics for a C categorization?

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